Workplace Pensions, Auto-Enrolment, Re-Enrolment and Declaration of Compliance
What is a Workplace Pension?
A workplace pension is a retirement savings scheme arranged by an employer to help employees save for their retirement. This became an employer’s legal obligation under the Pensions Act 2008 to put staff that met specified criteria in a workplace pension scheme and make contributions into the scheme. This is called ‘auto enrolment’.
The Pension Regulator issue fines for non-compliance of these legal duties.
Auto enrolment is a government initiative designed to help more people save for retirement through workplace pensions. This initiative aims to ensure that more workers have access to a pension to support them in their retirement years.
Auto enrolment is the term given to employers enrolling employees that meet certain criteria into a workplace pension.
The Pension Regulator define an employer as employing at least one person and if this is the case, the employer has legal duties which must be undertaken at specified times of the employment. These duties start on the day the first member of staff is employed.
The employer can delay the enrolment date for up to 3 months, in some specific cases it may be longer however there are duties that must be complied with. The main reason an employer may delay enrolment is to ensure the staff member passes their probation before paying any contributions in to their workplace pension.
It is important to note that if your staff member does not meet the criteria to place them in a workplace pension, the employer still has legal duties to undertake.
Once employees are in a workplace pension, the employer still has ongoing duties.
Re-enrolment is a mandatory process that occurs every three years after a company’s initial auto enrolment. It requires employers to re-assess their workforce and re-enrol eligible employees who may have previously opted out or left the pension scheme. This process ensures that employees who missed out on joining the pension scheme or opted out are given another opportunity to benefit from it.
The declaration is an employer’s legal duty.
Following the enrolment and re-enrolment process, employers must submit a declaration of compliance to The Pensions Regulator (TPR). This declaration confirms that the employer has met their legal duties, including assessing and enrolling eligible employees and making the necessary contributions. The declaration must be submitted within five months of the third anniversary of the employer's staging date and every three years thereafter.
The declaration includes questions about your workplace pension and employees.
Monitor staff ages and earnings and put them in a pension scheme when the criteria is met
Manage staff who request to opt out and refund the money paid if the criteria has been met
Record keeping – employers must ensure they have records showing how the legal duties have been met and the records must be kept for a certain amount of time
Continue to make contributions into the workplace pension
Ensure the re-enrolment process is followed every three years along with the declaration confirming the employer has met their legal duties
Why These Processes Are Important
Staying compliant with auto enrolment, re-enrolment, and the declaration of compliance is not just a legal requirement but also a critical aspect of supporting your employees' future financial well-being. Non-compliance can lead to significant penalties and damage to your business reputation.
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Expertise You Can Trust.
Navigating the complexities of auto enrolment and re-enrolment can be challenging. Our team of experts has extensive experience in pension compliance, ensuring that your business meets all regulatory requirements efficiently and accurately.